If Net Exports Become Less Sensitive to Changes in the Value

question 178

True/False

If net exports become less sensitive to changes in the value of the domestic currency, they will be less sensitive to changes in interest rates.

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Definitions:

Perfectly Elastic

A perfectly elastic demand or supply refers to a situation where the quantity demanded or supplied changes infinitely in response to any change in price, represented by a horizontal line on a graph.

Tax Burden

The measure of taxes that an individual or business is required to pay, expressed as a percentage of income or profit.

Tax Increase

A rise in the rate at which individuals or businesses are taxed by the government.

Snickers Candy Bars

A popular brand of candy bar consisting of nougat topped with caramel and peanuts, enrobed in milk chocolate.